Shirley Yam

Opinion | The hammer and sickle are making their way into some Hong Kong public companies

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As many as 19 Chinese state companies listed on the Hong Kong Stock Exchange have established Communist Party committees. Whose rules do they hew to?

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Chinese tourists posing in front a flag of the Communist Party of China in Shaoshan in Hunan province. Shaoshan is the hometown of Mao Zedong. The small village is a hot spot for 'red tourism'. Millions of Mao devotees from all over the country come to Shaoshan every year. Photo: AFP

Shirley Yam

Published: 4:40pm, 30 May 2017Updated: 10:59pm, 30 May 2017

A system under one country is creeping not only into Hong Kong’s political life but also the financial one.

At least 19 of the Chinese state-owned enterprises listed in Hong Kong are establishing Communist Party committees, and making them a key governing body to “advise” their boards on operational, personnel and strategic matters.

The city’s securities regulators have so far done nothing to bring members of these powerful committees under its regulations to protect shareholders’ interest and market integrity.

In China, the party has the ultimate say in state enterprises. For decades, that was more style than substance, but President Xi Jinping is making the party’s control very real.

Firstly, the party committee now commands a statutory status. Beijing has made it mandatory that companies amends their articles of association to set up party committees. In the 19 cases, amendments have already been made, or proposed last month.

Secondly, the committee commands resources. Most of the 19 promise to pay for the committees’ staffing and expenses.